Unfair Trading Practices in Milk Supply Chain

Abstract

The objective of this paper is to identify the occurrence of unfair trading practices (UTPs) in Slovakia’s milk agri-food supply chain. Based on survey data we aim to find out what UTPs are used at different stages of contract execution. We investigated the trade relationships between milk producers (dairy farms) and milk processors. Our results show that the weakest point of a business relationship, most exposed to UTPs is the phase of the contract negotiation. “No safeguard defined if the purchaser fails to fulfil the contract” is considered as the most common unfair trade practice by farmers. The highest incidence of UTPs is observed in the group of farms delivering more than 2 mil. litres of milk per year, especially when trading with big processor (dairies with annual sales more than 50 mil. EUR).